Independent primary care, as a business model, is in decline.
As the cost of healthcare continues to rise, the physician owned business committed to providing quality yet affordable primary care to individuals and families exclusively through complicated insurance policies has become untenable. And regardless of how essential primary care is to population health, and its role in value-based care, the rate of reimbursement has not kept pace with these rising costs and the changes in consumer behavior and demand for acute care options, post COVID.
Direct Primary Care (DPC) is an innovative approach to addressing the needs and trends of the healthcare consumer, and it has been gaining in popularity as a disruptive alternative to marketing primary care services. Arguably because the vision for DPC is to provide services at market value to consumers that are willing to pay for accessibility, convenience, and the care they need––a welcome break from the model that’s solely focused on squeezing the delivery of primary care into a rigid framework.
the DPC model is an opportunity to be more customer and patient experience focused
As a Medical Group, or a physician owned practice, the DPC model is an opportunity to be more customer and patient experience focused–-putting the patient at the center of care and emphasizing personalized service––and improve revenue through subscriptions and collecting ‘Self-Pay’ fees for non-covered services, or for acute care provided to patients willing to pay cash.
From the perspective of the patient, DPC is a model that offers accessibility and convenience; better communication with their provider; more affordable healthcare programs with less hassle or per-visit fees; and pricing transparency for an industry that notoriously operates in the ‘great unknown’ as it relates to billing.
To make the business case, the opportunity cost of implementing the DPC model can be win-win scenario. But it does not come without risk. Starting a new DPC practice requires capital and an aggressive consumer awareness plan. And transforming an established practice requires providers willing to change, and the ability to deliver an experience and level of service their patients/members would be willing to pay for.
Benefits of the Hybrid DPC Model
Established practices and medical groups considering a strategic transformation to a Hybrid DPC model should distinctly understand the difference between the “pure” and “hybrid” model.
Pure DPC providers deliver all services via the membership and subscription model, and they do not accept patients who continue to finance their healthcare through the third-party fee for service system. The pure model is best if you are starting a new practice exclusively as a DPC provider––and you’re willing to “opt out” of Medicare every two years.
Hybrid DPC providers are typically established practices with a large percentage of their current patient/members billing through their insurance group––but would like to offer non-covered services or DPC programs. The distinction between covered and non-covered care is in the details and the delivery.
As a Hybrid DPC, you can continue to see patients through traditional medicine billing and Medicare––and schedule appointments through your EMR and patient portal. But those same patients can also become members and “opt in” or subscribe to programs when the services being recommended or provided are not covered by their insurance.
Some examples of subscription-based programs that can be offered to patient/members:
- Telemedicine –– Relatively young and healthy patients (especially millennials) have adopted telemedicine as their preferred method to receive care. The value of 24/7 telemed accessibility and same day appointments is an ideal program for healthy individuals or families seeking ‘as needed’ acute care to augment a high deductible insurance plan.
- Prediabetes –– Most insurances cover nutrition counseling for people with diabetes, but offer next to nothing for prediabetes. Programs to address prediabetes could help prevent costly chronic care in the future.
- Wellness –– The tent for wellness is big enough to include subcategory programs such as Lifestyle Counseling, Weight Loss, Functional Medicine, and other Integrative Care services.
There are also concierge services and other examples of subscription programs, and these tend to lean more to the “pure’ model. But if expanding your services sounds like an opportunity, here is a high-level summary and step-by-step blueprint to launch a hybrid DPC practice.
1. Strategically Define Your Programs & Delivery Process
An established practice considering a pivot to the hybrid DPC model should first define what non-covered programs you could or would like to offer to your current patients. These are the customers already the closest to you (or audience under scope), and there is plenty of data within your EMR to craft one or two programs to get started––including the pricing and delivery model based on your market and primary audience.
2. Convert Patients to Members
Membership is a meaningful word that implies a sense of belonging and exclusivity. If there is a fee associated with membership, then with belonging comes an equitable expectation of benefits.
To implement the hybrid DPC model, you will need a plan to convert existing patients to members and be able to clearly define the value that comes with this transformation. And all new patients will automatically become members, too.
3. Implementation & Communication
The ‘platform’ to support the Hybrid DPC model can be as sophisticated as you need it to be. For scale, there will be an investment in digital systems and/or software to help automate processes and potentially integrated with your EMR (if needed). And once these systems and processes have been implemented and tested, you can start communicating and offering these programs to the existing patient/members that need them.
Assuming these three steps are customizable to each practice, an important thing to remember is the customer experience you deliver. Once launched, the level of engagement and loyalty you have with patient/members is up to you––and membership should always come with benefits.
Next Steps?
Is transforming your existing practice to the Hybrid DPC model is one of your strategic initiatives––and you would like some help exploring strategic and cost effective (scalable) options––please contact the HealthX Group: [email protected]